Reichmann faces Canary showdown

THE fate of prized Docklands development Canary Wharf and its founder Paul Reichmann was hanging in the balance today ahead of a crucial shareholders' meeting.

Pressure is growing on Reichmann to resign as a CW director - or risk being forced out - following a major boardroom row.

It will be a humiliating departure for the 73-year-old whose vision transformed an east London wasteland into a 'mini City' of steel and glass.

Investors will today vote on whether to approve £1.1bn in CW property sales - a condition of Morgan Stanley's £1.56bn bid for the rest of the estate. Reichmann is trying to block the sale because he wants to buy CW himself.

If he succeeds in thwarting the disposals and scuppering Morgan's bid, his position at CW will become increasingly untenable.

Only two months ago, Reichmann backed a unanimous board decision to approve the property sales - seen as key to company strategy even if it stays on the stock market.

His U-turn has infuriated CW executives and non- executives, led by chairman Sir Martin Jacomb. Only 48 hours earlier, Reichmann said he would abstain from the vote.

A source close to the board said: 'It is turning the situation into a farce. His behaviour is not in the interests of other shareholders.'

If the disposals - which need majority support - are approved, insiders think it unlikely that Reichmann will be forced out straight away.

One possibility is that Reichmann will be urged to step down as a director temporarily while he continues to work on his own bid. He stood down temporarily as chairman in November.